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Companies Get Strict on Health of Workers

Employers are increasingly trying to lower health care costs by using incentives to persuade workers to make better lifestyle choices, a new survey shows, but what remains less clear is whether a reward is better than a punishment — or whether the programs work at all.

The survey, of 800 large and midsize employers conducted by the human-resources consulting firm Aon Hewitt, found that the vast majority of companies, or 79 percent, use rewards like lower insurance premiums to try to nudge employees to improve their health. But increasingly, the survey found, employers are taking the programs a step further, by penalizing employees who do not make healthy choices and linking incentives to measurable results.

“Employers are feeling the need to intensify their efforts to create an environment where people feel they are responsible for their own health,” said Jim Winkler, chief innovation officer for health care at Aon Hewitt.

While a little more than half, or 56 percent, of the companies using incentives required employees to sign up for programs like health coaching or completing a questionnaire, 24 percent tied their incentives to progress on measures like a person’s blood pressure or body mass index. And the survey found that more than two-thirds of companies said they were considering taking similar steps in the future.

Programs that seek to impose consequences on workers by charging them higher premiums or requiring them to pay a surcharge for failing to take steps to lose weight or quit smoking have come under criticism by those who have argued that the policies are invasive and can punish people for health problems that not are always easy to fix.

Although some employees have sought to challenge such policies in federal court, arguing that they are a violation of privacy or of the Americans with Disabilities Act, the cases have so far failed to gain traction.

The programs are likely to increase in popularity in the years ahead, in part because, as part of the new health care law, beginning in 2014 employers will be able to use as much as 30 percent of a worker’s health care premiums on incentives programs, from 20 percent previously.

CVS Caremark, the large drugstore chain and pharmacy benefit manager, recently said it would require its 200,000 employees to report their weight, blood sugar and cholesterol or be forced to pay an annual penalty of $600. It also will require that smokers try to quit. Several other major employers, including PepsiCo and Wal-Mart, have also adopted such policies.

While the popularity of workplace wellness programs appears to be on the rise, there is less evidence about whether they actually lower health care costs or make employees healthier. Programs that reward people for good behavior may be singling out those who were already practicing healthy habits, while those that penalize workers for bad behavior may be unfairly singling out the very people who need lower health care costs.

“These are really hard behaviors and decisions to move the needle on,” said Michelle Mello, a professor of law and public health at Harvard. She cautioned against drawing too many conclusions from the Aon Hewitt survey, because the companies that participated may have been more likely to offer workplace wellness programs than those that did not. Aon Hewitt said the survey’s 20 percent response rate was typical for the industry and the companies who completed the survey were a representative sample.

One recent study of a workplace wellness program, at a hospital system in St. Louis, found that the program decreased hospitalization of its employees for some conditions, but did not actually save the system any money.

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Dr. Troy Brennan, the chief medical officer at CVS Caremark, agreed that the research into whether incentive programs worked was not yet conclusive, but said his company had already seen positive results. CVS is in the third year of an ongoing incentive program: in the first year, employees were asked to answer questions about their health, and in the second they were encouraged to undergo basic tests, like blood sugar and cholesterol, or face a $180 penalty. This year, the penalty was increased to $600.

Since the program began, Dr. Brennan said, employees’ overall blood sugar has decreased, as have their cholesterol levels, while their so-called good cholesterol has increased. So far, employees do not receive rewards or penalties based on their improvements on these measures, but Dr. Brennan said it was possible.

He said he understood that these policies created some discomfort, and said patients’ individual data was kept private from the company. CVS contributes millions of dollars toward workers’ health insurance, like most other employers, Dr. Brennan said, and thus has a stake in its employees’ health. “Like it or not, in this country, employment and health insurance and health care are all intimately related,” he said.

Several health groups, including the American Heart Association, have expressed concern over the growing popularity of incentive programs, saying they could be used by employers to transfer the higher costs of health care to sicker individuals.

Laurie Whitsel, director of policy research for the American Heart Association, said she was encouraged by a proposed rule by the Obama administration that would require employers to accommodate workers whose doctors concluded that certain goals, like losing weight in a short period, would be unhealthy.

Still, she said, many questions remained unanswered. “Ultimately it’s really going to be a national experiment,” she said.

A version of this article appears in print on March 26, 2013, on Page B1 of the New York edition with the headline: Companies Get Strict On Health Of Workers. Order Reprints|Today's Paper|Subscribe